Chip shares lead hardware group higher

DavidB. Wilkerson

NEW YORK (CBS.MW) -- Semiconductor shares led the hardware sector higher Thursday on the strength of Prudential analyst Ali Far's positive new coverage on Linear Technology and several other chip makers.

Far said in a research note that he expects to see an "acceleration" of business fundamentals in the semiconductor industry during the second half, "causing multiples and earnings to expand." His upbeat forecasts for five chip companies are based on this premise.

The analyst started Linear Technology (LLTC)
LLTC
with a "strong buy" rating, calling the company a "premier supplier of high-end analog products and one of the best companies in the semiconductor industry."

The stock rose 9 1/2 to 104 1/2.

The analyst set a 12-month price target of $120. "[W]e believe investors should benefit from [Linear Technology's] solid earnings-growth rate of about 20-25 percent," he said.

Also Wednesday, Altera (ALTR)
ALTR, +0.58%
CEO and Chairman Rodney Smith says the developer of programmable-logic chips and tools saw sales growth of 4 percent in 1998, far greater than the negative performances of its competitors. Smith said the telecommunications industry has largely driven growth "for the past few years." Altera reported record earnings of 42 cents a share in fourth quarter 1998. Smith said he expected the company's acquisition of Wafer Tech to break even by mid-year. The shares climbed 5 7/16 to 58 15/16.

Intraday Data provided by SIX Financial Information and subject to terms of use. Historical and current end-of-day data provided by SIX Financial Information. All quotes are in local exchange time. Real-time last sale data for U.S. stock quotes reflect trades reported through Nasdaq only. Intraday data delayed at least 15 minutes or per exchange requirements.